During the June 2014 sitting of Tynwald this Honourable Court received the legal opinion of Mr Richard Moules in relation to the assistance given by the Government to the Sefton Group in respect of the loan given in 2012 of £450,000; the loan provided in 2013 of £1.3m; and the purchase and subsequent leaseback arrangement of the Middlemarch site.

Honourable Members will be well aware that Mr Moules considered that the loan transactions were likely to be found to be ultra vires if tested in a court of law, and that a course of action was required to ratify or regularise the transactions entered into by the Department concerned.

At the time of June Tynwald the Treasury Minister committed the Council of Ministers to return to Tynwald at this sitting by which point we would have had the opportunity to fully consider the legal opinion of Mr Moules.

I am pleased to report that since then not only has the original legal opinion been considered, but Government has also taken the necessary steps required to bring this matter to a conclusion.

Madam President

You will be aware that following the June sitting of Tynwald I reluctantly accepted the resignation of the Minister for Economic Development. I say reluctantly as I believe that Mr Shimmin brought positivity, drive and success to the Department and that we have lost an asset; but I accept that he wished to honour his word and that some Honourable Members believed retaining his position would compromise public confidence in Government.

With regard to the legal opinion, following the conclusion of June Tynwald immediate steps were taken to make a further request of Mr Moules, to secure his opinion on how Government could ratify or regularise the transactions entered into by the Government to assist the Sefton Group.

I am pleased to state that Mr Moules considered the options for government and specifically advised that there were 3 courses available:-

Treasury has the requisite powers under the Financial Provisions and Currency Act 2011 to regularise the matter;

New legislation to validate the payments could be made retrospectively;

Government may elect to make a decision not to seek restitution.

He concluded that, and I quote: -

1)Treasury has power (without needing Tynwald consent) under the 2011 Financial Provisions and Currency Act 2011 to regularise the loans by using its section 4 power to make the loans or to enter into an arrangement/agreement with the Sefton to settle the restitution claim and secure repayment.

2)Alternatively, the Government could promote new legislation to validate the loans retrospectively or to amend the 2009 Regulations retrospectively.

3)The Government could also simply decide not to seek restitution, but this would not regularise the transactions and there might be difficulties in securing repayment. I do not recommend this option.

Discounting the third option, Council of Ministers agreed that the most appropriate way to regularise the situation would be to proceed with option 1, and to enter into a tripartite agreement with the Treasury, the Department of Economic Development and the Sefton Group, under the provisions of the Financial Provisions and Currency Act 2011.

Therefore acting upon the advice of learned Counsel, who provided the initial opinion on the vires of the loans, we have since followed the design of the same expert to remedy the matter and I am able to report that this tripartite agreement is now in force and I would like to put on record my thanks to the Sefton Group for their co-operation in this matter. I can confirm to this Court that the new agreement does not change the terms of the original agreements in any way and is therefore neutral on all parties.

Going forward, Honourable Members will be pleased to note that the necessary governance arrangements have also been put in place. The revised arrangements with respect to these loans will be reported in Government’s Annual Accounts with an accompanying explanatory note and I am advised that the Treasury has already engaged in discussions with the Government Auditors in this respect. Furthermore, the transaction will be reported in the July 2015 Annual Report to Tynwald on the application of the Financial Provisions and Currency Act 2011.

Madam President, Honourable Members,

As Chief Minister, I do not condone the situation that has arisen and steps are being taken to understand how it occurred and to ensure lessons have been learnt. I do, however, believe that the mistakes were made in good faith and we are now in a position where the vires issue is resolved and I am satisfied that the necessary governance arrangements are adequate.

This website and its associated newspaper adheres to the Independent Press Standards Organisation's Editors' Code of Practice.
If you have a complaint about editorial content which relates to inaccuracy or intrusion, then contact the
Editor by clicking here.

If you remain dissatisfied with the response provided then you can contact the IPSO by
clicking here.

Isle of Man Today provides news, events and sport features from the Isle of Man area. For the best up to date information relating to Isle of Man and the surrounding areas visit us at Isle of Man Today regularly or bookmark this page.

For you to enjoy all the features of this website Isle of Man Today requires permission to use cookies.

Find Out More ▼

What is a Cookie?

What is a Flash Cookie?

Can I opt out of receiving Cookies?

About our Cookies

Cookies are small data files which are sent to your browser (Internet Explorer, Firefox, Chrome etc) from a website you visit. They are stored on your electronic device.

This is a type of cookie which is collected by Adobe Flash media player (it is also called a Local Shared Object) - a piece of software you may already have on your electronic device to help you watch online videos and listen to podcasts.

Yes there are a number of options available, you can set your browser either to reject all cookies, to allow only "trusted" sites to set them, or to only accept them from the site you are currently on.

However, please note - if you block/delete all cookies, some features of our websites, such as remembering your login details, or the site branding for your local newspaper may not function as a result.

The types of cookies we, our ad network and technology partners use are listed below:

Revenue Science ►

A tool used by some of our advertisers to target adverts to you based on pages you have visited in the past. To opt out of this type of targeting you can visit the 'Your Online Choices' website by clicking here.

Google Ads ►

Our sites contain advertising from Google; these use cookies to ensure you get adverts relevant to you. You can tailor the type of ads you receive by visiting here or to opt out of this type of targeting you can visit the 'Your Online Choices' website by clicking here.

Digital Analytics ►

This is used to help us identify unique visitors to our websites. This data is anonymous and we cannot use this to uniquely identify individuals and their usage of the sites.

Dart for Publishers ►

This comes from our ad serving technology and is used to track how many times you have seen a particular ad on our sites, so that you don't just see one advert but an even spread. This information is not used by us for any other type of audience recording or monitoring.

ComScore ►

ComScore monitor and externally verify our site traffic data for use within the advertising industry. Any data collected is anonymous statistical data and cannot be traced back to an individual.

Local Targeting ►

Our Classified websites (Photos, Motors, Jobs and Property Today) use cookies to ensure you get the correct local newspaper branding and content when you visit them. These cookies store no personally identifiable information.

Grapeshot ►

We use Grapeshot as a contextual targeting technology, allowing us to create custom groups of stories outside out of our usual site navigation. Grapeshot stores the categories of story you have been exposed to. Their privacy policy and opt out option can be accessed here.

Subscriptions Online ►

Our partner for Newspaper subscriptions online stores data from the forms you complete in these to increase the usability of the site and enhance user experience.

Add This ►

Add This provides the social networking widget found in many of our pages. This widget gives you the tools to bookmark our websites, blog, share, tweet and email our content to a friend.